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It's never easy or straightforward when the Fed is meddling with the markets, trying to make red looks like green, and black look like white.
If you cannot stomach this you are much better off as a long term investor.
These are the games people play especially in times of regulatory laxity and politicization of the markets.
If Goldman Sachs offered to sell you AAA rated collateralized debt obligations, would you take the deal? What if Bernie Madoff opened a new investment fund? Would you hand over your precious savings?
What makes you think that the equity market is any different, since it is being ladled out by the same unreformed and underregulated financial machine that has been defrauding customers and selling mispriced financial assets for over ten years?
Oh, but this is different. These investments are 'real companies' with 'real earnings.' After all, this is not 1999 or 2007. Now you have Dodd-Frank directing the SEC and the CFTC to crack down on the insiders and protect your investments.
And the average 'ownership' time for a share of stock is under a New York minute, with the potential for the market to vaporize while you go to sleep or even step out for lunch. Oops, we pushed a button, and all your money is gone. But this cannot be, because at the Fed, and the NYSE, and the City of London serving the public interest openly and transparently is job one. Just ask them if this is not so.
Little wonder that the ruling elite of the US and Europe hold the investing public and the rest of the world in complete contempt.
Nice bounce off a deeply oversold condition as we noted yesterday.
And of course today was the anticipated option expiration on the Comex. How unusual.
So far no surprises, but too soon for the bulls to break out the party hats for a return to trend.
Eric Sprott said that he thinks gold is putting in 'a low for the year.' I am not sure where the low is, but save a panic liquidation in stocks, that seems like an historically good bet.
It amazes me that the discussion on change centers on 'improving competitiveness' when the crisis was caused by a massive financial fraud and political and regulatory failure that goes largely unresolved and unrepaired, sucking the life out of the real economy and spreading corruption of thought and action. Slogans and code words are the substance of the public policy discussion in the US and Europe, and I think with the intent to deceive, a propaganda campaign. The mainstream media in the States is owned by a handful of powerful corporations. But fewer and fewer turn to the mainstream media anymore.
"In addition, any economist will tell you that when the free market fails a black market emerges. The blogs are the black market of information."
David B. Collum, Cornell University
As for competitiveness, the current global trade regime is underpinned with and founded on a fraud, a set of managed currencies pinned to the US dollar and under the control of a banking cartel. There is no real free trade, only an illusion of such, promoted by the rapacity of multinational corporations and their partners in authoritarian governments.
The only real competition I can see is the race to destroy the middle class and reduce the public around the world to the least common denominator of slavery, serfdom, and servitude, with the dollar and the jackboot as their weapons.
From Mark Thoma:
"Eliminating regulation: The idea is that removing unnecessary regulation will improve our ability to innovate, and this will help the economy create new, good jobs. However, it wasn't lack of innovation or lack of competitiveness that got us into this mess, it was an out of control financial sector.
The President talked about eliminating unnecessary regulation, but far too little was said about the need to implement new regulations where they are needed. In addition, by focusing so much on helping business, the president risks sending the message that what is good for business is necessarily good for the nation. (Risk? As the risk of sounding snarky, that is the reason for the season. It was the corporate FIRE sector that caused the financial crisis in the first place. - Jesse)
Businesses need the right environment to thrive, but we must not lose sight of the fact that it's the skills of the people that work at businesses that matters most. Our ultimate goal is the best possible life for as many people as possible, and that requires a broader focus than businesses alone."
